Properties, Homes & more

[Ref: ABC News]

In Grand Isle, La., July-August usually is a busy season for most realtors. Interested buyers come to check out the available properties in this barrier island known for its July fishing rodeo, sandy beaches and vacation homes. But since the Gulf oil spill sent a sheen of oil into the island’s bay, Curole’s buyers have fled. First, they put closings on hold. Then they canceled contracts. Now she’s hoping to get some money from BP for lost commissions.

The beach is now clean, she says, but sales are still suffering. The buyers aren’t simply there. In coastal areas of Alabama, Louisiana and Mississippi, the spill has whacked housing prices. Some residential and commercial development deals have fallen apart, and Realtors and brokers have watched demand falter as some buyers balk.

Most of the 4.9 million barrels of oil that gushed from the well have been contained, with about 26% dispersed into the waters, scientists at the Interior Department and National Oceanic and Atmospheric Administration reported this month. Waters most affected by the BP oil spill are largely between Louisiana state waters at the mouth of the Mississippi River and waters off Florida’s Pensacola Bay, according to the White House. There’s virtually no remaining threat to the Florida Keys or the East Coast, the government has said. But fears persist that property values could drop even in areas where the oil has not been spotted, and concerns that tar balls could wash up has been enough to sink some sales.

We have seen one of the worst recessions of the century for real estate industry. The prices sank to all-time lows, with returns dipping below investments. However,post mid-2009, the property market has regained momentum - not only in India, but also around the world. Almost every metro across the world has witnessed a surge in property sale / lease. Especially, Mumbai, Hong Kong, Singapore, London, and New York. When it comes to London, I can dream of fantastic palatical bungalows situated in some of the most beautiful premises one could imagine. But getting a property in London is equally difficult. The most important criteria for property, especially in Central London, are: Money, Money, and Money.

London property, be it residential or commercial, does not come cheap. And where there is huge money involved, fraud automatically follows. One should be utmost careful while buying / selling / leasing real estate in metros, especially like London. Hence you should always take assistance from expert agencies / brokers - The London Property Buyers (TLPB) is one of these who will provide genuine advice and assistance is all kinds of dealings in real estate in and around London. Promoted by Laurence Moore, this family business is one of the proud members of National Landlords Association of the UK, which in itself is a proof of ethical business practices! TLPB buys directly from individual sellers for cash, so that there is only one entity throughout the deal. No middle men, no hidden charges, no fees… only complete satisfaction and value for money. TLPB can not only assist buyers/sellers in repossession of real estate, but can also offer expert help in various allied areas  like Stop Repossession, Probate & Inheritance, Relocation, Debt Management, and Personal emergencies.

The process of TLPB is simple. As a first step, TLPB will offer you expert advice on appropriate properties for you depending on your requirements. After the detailed discussions, and only after you’re satisfied with the real estate offered to you, the deal - cash for homes - is cracked. And the final step is that you get 100% peace of mind since there is no fishy business out here with TLPB. By choosing TLPB, one can be assured of utmost professionalism, transparent business practices, speed and flexibility, and peace of mind for everyone. If this is not enough a kick for you, you should call TLPB directly at +44.0800.879.9889 and experience the pleasant change! The rule of thumb is: If you want to buy/lease/sell property quickly, turn to TLPB.

The Government of India (GOI) may modify the draft direct tax code to retain tax shelters on interest and principal repayments for home loans to make the proposed new code more attractive for the average Indian, a finance ministry official told The Economic Times. The proposed direct taxes code, which has been unveiled for public debate and is due to become operational from April 2010, does not provide tax incentives to loan-funded house purchases that are for personal use.

At present, taxpayers are allowed to deduct from their income the interest paid on home loans to a maximum of Rs 1.5 lakh every year. In addition, the repayment of the principal amount is also allowed to be included within the rebate available under section 80C, which has a maximum limit of Rs 1 lakh.

The draft code, billed as a comprehensive reform of the direct taxes regime, has suggested increasing the exemption limit under section 80C to Rs 3 lakh, but the list of eligible expenditure/savings does not include the principal payment. The code also restricts the interest deduction only to in respect houses rented out and where such income is included in the income of the assessee. At present, if a home buyer in the highest 30% tax slab were to avail the maximum tax exemption available on home loans then government loses over Rs 77,000 in tax.

The planned move to discontinue tax benefits for housing has faced widespread criticism and the finance ministry official said that they are looking at provisions (in the direct taxes code) that concern common man directly, including tax incentives to housing.

Banks say NO to uniform home loan rate cut

The contentious issue of “uniform home loan rates for old & new customers” cropped up when CEOs of large banks recently met senior RBI officials to suggest possible measures that the central bank could consider for the January 29 monetary policy. At the meeting, RBI deputy governor KC Chakrabarty reprimanded bank chiefs over their inability to pass on the benefit of lower interest rates uniformly to all customers - including old customers. It should be remembered that this has been a common practice among lenders that while they are slow to pass on a rate cut, they are quick to hike either the loan term or the EMI when rates go up.

Bankers argued that since the incremental cost of fund had softened, they could charge lower rates only to new customers while old customers had to pay more as old funds were raised at a higher cost. Countering this, RBI said that reduction in incremental cost of funds also brings down the average cost of fund for a bank which should then be in a position to offer the new, lower lending rate to old as well as new borrowers. Some banks even said that offering the same rate to all customers could spark legal feuds since interest spreads (over or below the PLR) varied from customer to customer, each of whom sign separate loan contracts with banks.

Cheaper home loans to old customers not feasible: IBA

Amid a debate over teaser rates, bankers have turned down the RBI’s suggestion to extend the cheaper home loans to existing customers saying that the move will impact their bottom lines. The IBA said if banks offer lower rates to old customers as well, this will affect their earnings as it is not feasible for them to change their deposit rates accordingly to compensate this loss of interest arising from such a move.

Banks will not withdraw prepayment penalty on forclosure

Competition Commission of India (CCI), the apex body that operates to sustain and promote competition, recently sent notices to atleast 15 banks, NBFCs and IBA seeking explanation on why they penalise borrowers who choose to foreclose loans. Many of these institutions have already replied to CCI, to make it clear that the removal of prepayment penalty will result in higher lending risk and may cause asset-liability mismatch in banks.

A few days back, a leading newspaper carried an advertisement on their front page from a builder claiming that they are going to shed a light on the truth and are digging out the fact how the projects from another leading builder are charging Rs 5800/sqft for Plinth Area using hidden costs like Common Areas etc while they charge only Rs 2370/Sq ft for Plinth Area exclusively.

Now, the focus of a property seeker shifts towards the fact that how must he save himself from these smart games from the builder where he tries to buck extra? The smooth talking salesmen on the site of the builder chooses to skip on this fact too. So what should we do? The only way to save your skin from this hook is to have the right knowledge on the Carpet Area , Super Area and Plinth Area.

Here is a quick run-through the exact definitions you should know before diving in to scoop the best deal on property.

• “Carpet Area” refers to the total usable area within the four walls of an apartment or a commercial space, as the case may be. In other words, it refers to the area for which a carpet can be laid if required by the owners.
• “Plinth Area” refers to the entire carpet area along with the thickness of the external walls of the apartment. It obviously includes the thickness of the internal walls and the columns, if any, lying within the four walls of an apartment. The commercial space is not taken into account in calculating the plinth area.
• “Super Built-up Area” refers to the plinth area of an apartment or a commercial unit as added by the balconies and other common areas like corridors, staircase, lift room, motor room, security room, meeting hall, gymnasium and an area reserved for indoor games.

The builders, while advertising or quoting the rates for there properties, tag the carpet area and print the rates of the same in there commercials and public issues. But what they usually sell you is the Plinth Area. There has been a huge lot of roaring on this matter in past and yet the strength of the definition of Builder Area’s is enigmatic.

How many of us really get into the carpet area? We seem to simply go by what the builders say in terms of the saleable/chargeable area.

DO NOT GET FOOLED BY THE BUILDERS. I am intentionally posting this on April Fool’s Day, so as to warn all the readers and prospective proerty-buyers from being called “April Fooled by the builder”!!! Pass on this warning to all those you care about.